Preventing family conflict is one of the biggest concerns that clients have when preparing their estate plans – for good reason! Dealing with the death of a loved one is overwhelming. That stress intensifies when family members must distribute their loved one’s assets. That stress can blow misunderstandings out of proportion – leading to fights and resentment in the family that can ruin relationships and cost thousands of dollars in legal fees. Thankfully, there are some important steps that you can take to prevent those conflicts. Three very important steps you can take are: appoint co-trustees, pick a fun way to distribute your personal belongings, and communicate openly with your family about distributing your belongings.
Tip Number 1. – Appoint your Trustee Carefully
When deciding who will be the trustee after you have passed, it is important to carefully decide who to appoint as a trustee. You need to carefully decide who to appoint as a trustee because managing a trust is a demanding task and you need someone that you can trust.
While these 3 tips do not cover everything that you can do to prevent family conflict, if you communicate openly, have a fun way to distribute your personal belongings, and appoint co-trustees of your estate, you will be prepared to prevent many of the future family fights that could come.
Tip Number 3. – Communicate Openly with your Family
Open communication with your family is the most important way to prevent family conflict. Family conflict usually happens when family members feel like belongings were not distributed fairly. Because the death of a loved one is so stressful and overwhelming, it is understandable that a family member would feel like something was not fair and react badly.
An effective way to prevent those misunderstandings is to record a video or write a letter explaining why you gave specific assets or belongings to a specific person. This allows your loved ones to understand why you made those decisions. Understanding will calm tensions and will help your loved ones feel that they were treated fairly.
Some clients like to communicate openly about their estate plan with their loved ones before their death. Some communication is essential – such as, where your children can find your estate plan after your death. However, openly telling your loved ones exactly what you plan to give them could cause problems. It may make your loved ones feel entitled to that possession, which can make it harder to change your estate plan in the future.
Overall, a key step you can take to prevent family conflict is to let your loved ones know the “why” behind your decisions.
Managing a trust is difficult.
Whoever you choose to be trustee will have to manage your estate and deal with legal, tax, and accounting issues. If you choose a family member to be your trustee, he or she will also have to handle questions, concerns, and frustration from other family members, while dealing with the demands of their own life and grieving your loss. Doing this job is incredibly difficult. Make sure that whoever you appoint can handle the responsibilities.
You need someone that you can trust.
Since the trustee is authorized to control your estate, the trustee has a lot of power. You want to make sure that you choose a trustee who knows what the rules are and who has the integrity to follow them. Trustees who use the trust for their own benefit or go on a power trip are a common source of legal battles. If the trustee is a member of the family, problems with the trustee can also be a source of enduring resentment in the family.
Tip Number 2. – Make it Fun!
Losing a loved one is incredibly difficult. Especially when grieving children must decide how to distribute their parents’ belongings. This stressful situation can cloud people’s judgment, causing tensions to boil over.
Luckily, you can take some of the stress out of this situation and distribute your belongings to whoever values them most. You can do this by creating a fun way to distribute your personal belongings. While there are many methods that people choose to do this, two common methods are the “list it” and the “family auction”.
In the “list it” method, your children create a ranked list of what belongings mean the most to them, then the belongings are distributed to whoever ranked it the highest. This option makes sure that your belongings end up with the person that appreciates them the most.
In the “family auction” method, your children receive fake money and hold an auction where they bid on your belongings. This method allows your children to distribute your belongings while having a fun time together. It also makes sure that your belongings end up with the person who values them the most.
There are many other methods that you can use to distribute your belongings. The most successful methods allow your loved ones to have some fun together. If you are interested in including one of these methods in your estate plan, speak with an estate planning attorney.